Policy 1-10 ECONOMIC DEVELOPMENT ASSISTANCE - RETAIL

DISTRIBUTION:  Mayor, City Council and All Departments

SUBJECT:  Economic Development Assistance Policy - Retail

PURPOSE:  To develop and initiate an economic retail development assistance policy to provide retail development incentives.

BACKGROUND:  During the past year, it has become very apparent to the City of Lawton that increasing outside interest from commercial enterprises makes it necessary for the City to set in place a retail development assistance policy.  A city Council policy covering the economic development incentives and guidelines for potential retail projects seeking financial support is important given statutory limitations established by the State of Oklahoma.  In this regard, the attached Economic Development Assistance Program, Council Policy 1-10, adopted by the Lawton City Council  on February 24, 2009, recognizes the City's interest in assisting viable retail development projects and the procedural guidelines for securing public investment through the City of Lawton.

This retail development policy will be administered by the Lawton Economic Development Authority (LEDA), acting as an advisory committee to the Lawton City Council.  All final decisions regarding the scope and size of any financial incentives offered to a proposed retail development shall be at the sole discretion of the City Council.

PROCEDURES:  See Attachment A

REFERENCES:  None

EFFECTIVE DATE:  This policy becomes effective February 24, 2009.

____/s/ John P. Purcell, Jr._________
JOHN P. PURCELL, JR., MAYOR





















CITY OF LAWTON
ECONOMIC DEVELOPMENT ASSISTANCE POLICY - RETAIL

Table of Contents

I.    PURPOSE STATEMENT------------------------------------------------------------------------------- 1

    A.    Principles------------------------------------------------------------------------------------------- 1
    B.    Priorities-------------------------------------------------------------------------------------------- 1-2
    C.    Tax Increment Financing (TIF)------------------------------------------------------------------ 2

II.    RETAIL DEVELOPMENT PROGRAM------------------------------------------------------------- 2

    A.    Special Consideration for Retail Developments----------------------------------------------- 2
    B.    Types of Retail Projects--------------------------------------------------------------------------- 3
    C.    Development Assistance-------------------------------------------------------------------------- 3
    D.    Analysis--------------------------------------------------------------------------------------------- 3
    E.    Forms of Incentives-------------------------------------------------------------------------------  4
    F.    Performance Based Incentives-----------------------------------------------------------------  4-5
    G.    Applications----------------------------------------------------------------------------------------  5
    H.    Other Information---------------------------------------------------------------------------------  5

Attachment A -  Listing of Retail Standard Industrial Codes (SIC)------------------------------------------  6

Attachment B - Retail Incentive Application-------------------------------------------------------------------- 7-9


























CITY OF LAWTON
ECONOMIC DEVELOPMENT ASSISTANCE POLICY
RETAIL

I.    PURPOSE STATEMENT

The City of Lawton is committed to the promotion of high quality retail development in all parts of the City and to ongoing improvement in the quality of life for its citizens.

This policy is established in an effort to develop and expand the local economy by promoting an encouraging retail development and redevelopment projects that enhance the City's economic base through the expansion and diversification of job opportunities and new private investment.

In furtherance of these goals, the City of Lawton will consider, on a case-by-case basis, requests for economic development assistance to private retail business entities in order to make possible project that would not otherwise occur.

Nothing in this policy is intended to imply that the City is under any obligation to provide economic development assistance to any applicant.  All applicants shall be considered on a case-by-case basis.  The decision to provide economic development assistance shall be at the sole discretion of the City Council.  Any applicant granted economic development assistance must enter into an agreement with the City of Lawton, or a public trust who sole beneficiary is the City of Lawton, which contains all terms required by State statutes, City Code, this Policy, and other applicable law, in order to protect the public interest in ensuring an adequate public benefit in exchange for the investment of public funds, assets or services in the economic development project.

A.    Principles:    In providing economic development assistance,the following principles shall be followed:

    1.    The City's credit and financial interest shall never be placed at risk.

    2.    The project must promote the public health, safety, security, prosperity and general welfare of the community.

    3.    The project must offer opportunities not currently available.

    4.    The City must have a legal interest in the land upon which any public infrastructure is constructed.

B.    Priorities:    In considering request for retail economic development assistance, the following circumstances will enhance an application's priority:

    1.    Primary consideration may be given to development and redevelopment activities located in areas targeted for development and redevelopment in the City's general plan, such as blighted areas, urban renewal project areas, established "enterprise zones" or established "tax increment finance district".  Consideration shall also be given to projects that will make a unique or unequaled contribution to development or redevelopment efforts in the City, due to the project's magnitude, significance to the community or aesthetic quality.

C.    Tax Increment Financing (TIF):    Where appropriate, the City of Lawton may choose to provide economic development assistance under the Oklahoma Local Development Act, 62 O.S. Section 850 et seq., including through the use of tax increment financing (TIF).  The City's method of financing economic development assistance for a particular project is a legal and financial decision of the City, not the applicant.  It is the policy of Lawton (city) to receive adequate consideration and accountability from private developers or redevelopers when providing tax increment financing (TIF) to projects, and to achieve specific public policy objectives.  Public policy objectives for TIF project areas include but are not limited to eliminating blight, encouraging economic revitalization, and encouraging investment and development that otherwise would be difficult or impossible.  In addition, the following principals will guide the City's use of TIF assistance to economic development projects:

    1.    To receive an allocation of TIF revenues, an investment must meet the public policy objectives set forth in the project plan for the particular TIF district where the project is located.

    2.    The TIF revenues may be used to pay project costs as defined by the Local Development Act (62 O.S. Section 853(14)).  The City's preferred method for providing TIF assistance to a project is for the TIF revenues to be paid over time as the developer or redeveloper performs on covenants meeting the public policy objectives, with the performance providing the public benefits to the City and the public.

II.    RETAIL DEVELOPMENT PROGRAM

A.    Special Considerations for Retail Developments.   The City Council recognizes that assistance to retail developments raises special considerations and requires extra assurances of fairness, impartiality, and adequacy of public benefit.  For that reason, the principles, outlined in paragraphs "B" thru "H" of this section, shall be followed in providing development assistance to developments that are primarily retail in nature.

The Lawton Economic Development Authority (LEDA) shall be responsible for initial review of all retail development proposals submitted to the City of Lawton.  LEDA will act as a recommending body to the City Council and will prepare a evaluation report based on the information contained in the application.

For the purposes of this policy, a development is considered "retail" if the majority of its usable space is leased or owned by a business which falls within one of the Standard Industrial Codes (SIC) categories shown on "Attachment A".

B.    Types of Retail Projects

    1.    Public financial support for retail developments shall be given to redevelopment projects located in areas that have already been identified as areas needing assistance for development, is defined as:  an urban renewal project area, an enterprise zone, or a tax increment finance district.

    2.    Public financial support may be given to development and redevelopment projects and activities located in other areas specifically targeted for commercial development and redevelopment in the City's general plan, especially: (re)development on a Brownfield site, (re)development of vacant or derelict buildings, redevelopment or under performing and older commercial/retail centers, and (re)development of neighborhood with little or no shopping or retail development to serve the local population.

    3.    Public financial support may also be considered to retail development in other areas of the City.

C.    Development Assistance.  Development Assistance may be provided to a retail project if it is one of the following types:

    1.    Retail Projects:  A Regional Retail Project is a development that contains a retailer or group of retailers who will offer products or goods (subject to sales tax).  A regional retailer is expected to attract new sales tax dollars or retain sales tax dollars that may otherwise go to a nearby cities or metropolitan area.  In addition, A Regional Retail Project is defined as a development that contains at least 50,000 square feet of net usable retail space and contains a minimum of five (5) acres of developmental land area.

    2.    Neighborhood Retail Projects:  A Neighborhood Retail Project is defined as a project that provides retail service to a designated redevelopment neighborhood, approved by the City or established by the formation of a T.I.F. District.  This neighborhood retail development must have at least 10,000 net usable square feet of retail space or must have the capacity to expand to provide essential projects for area residents.

D.    Analysis.  In determining whether, and to what extent, development assistance to a proposed retail project is appropriate, the City Council will consider the following issues in order to establish that the public benefits to the City will be positive within a projected time frame:

    1.    Cost of the development assistance (including labor costs of City Staff)

    2.    Cost of city services such as police and fire.

    3.    Wear and tear on City streets and roads and current carrying capacity.

    4.    Increased burden on water, sewer and storm systems.

    5.    Estimated "transfer losses" from existing merchants.

E.    Form of Incentives.  To the extent permitted by law, the City or a City beneficiary Trust may assist a retailer or retail developer by providing the following:

     *    Public roadways
     *    Traffic signals
     *    City utility extensions
     *    Drainage improvements
     *    Streetscape improvements in or around the development that encourages pedestrian traffic.
     *    Extended public transportation network
     *    Parking garage
     *    Installation of fire hydrants and related infrastructure

NOTE:    Unless the retail development is located in an urban renewal area, public infrastructure improvements that meet the following definition for "public use" are the only infrastructure item for which assistance that may be provided.  "Public use requires that the work shall be essentially public and for the good of all inhabitants of the taxing body (city)...a public purpose affects the inhabitants of the ...taxing district as a community not merely as individuals."  An example of an infrastructure item that would be public but not qualify is  sewer or water main that can only serve the proposed development.

Provision of public infrastructure, whether funded by TIF revenues or by other means, shall be the City's generally preferred method of providing assistance to retail development projects, even in areas other than urban renewal project areas.  The City, a public trust with the City as it s beneficiary, or the Lawton Urban Renewal Authority (LURA) may construct public improvements on publicly owned land or easements.  These improvements will be constructed using any legally applicable competitive bidding process.  

    2.    Assistance with public process including permitting, zoning, codes, site plan approval and site inspections (no waivers or variances unless authorized by code will be considered).

    3.    Site acquisition (urban renewal area only).

    4.    Site preparation for contaminated Brownfield or downtown infill projects.

F.    Performance Based Incentives.  Incentives to retail shall be based on the estimated amount of new City sale tax generated that can be reasonably defined and determined to result from the new development and shall be limited to fifty percent (50%) of the City Sales Tax collected for the approved development.  The package of incentives will be determined once all of the review and analysis of the retail development proposal is completed under Section D.  The policy strongly recommends a performance-based approach to incentives; therefore reimbursement of actual expenses will be the preferred method of implementing the incentives.  The City shall determine the appropriate form of incentives which may include low interest loans, public infrastructure and improvements, or discounts on future operational costs.  The City will begin/start the reimbursement payment schedule upon the occupancy of the first tenant space and will be pro-rated.  Any reimbursement payment scheduled approved by the City of Lawton shall not exceed a term of five (5) years.

G.    Application.  Prospective retail developers and retailers will make a formal request for retail incentives to :

    City of Lawton
    212 SW 9th Street
    Lawton, Oklahoma 73501
    Attn:  City Manager

A one time non-refundable application fee of $750.00 shall accompany all applications.  The attached form "Attachment B" shall be used.  Applications will be reviewed to determine if the development meets the guidelines of this policy.  The Lawton Economic Development Authority will perform the initial review of all retail development applications and the Lawton Industrial Development Authority (LIDA) will perform the initial review for all industrial development applications.  If the development meets the requirements of this policy, the City Attorney's office will prepare an Economic Development Agreement (EDA) containing at a minimum performance standard, a development time line and base line standard for initiation of payment of possible incentives.  All proposed EDA's will be reviewed by the City's bond counsel to insure that the proposed agreement does not adversely affect the City's ability to issue nontaxable municipal bonds now or in the future.  The agreement will be forwarded to the City Council for approval; however, if the EDA is for a time period that extends beyond the end of the current City fiscal year, the Council will refer the agreement to the Lawton Economic Development Authority or another City beneficiary trust to carry out the multi-year aspects of the agreement.

H.    Other Information.  In addition to completing the application, applicants may be required to provide a trade area analysis; a market analysis; a feasibility study; traffic study and other information deemed relevant by the City.  In addition, such retailers and retail developers may be required to submit financial information regarding the project.  To the extent permitted by the Oklahoma Open Records Act Title 21 Oklahoma Statutes Section 24A.1 et seq, the City will ensure its best effort to keep personal financial information confidential.



















































Attachment A
Listing of Retail Standard Industrial Codes (SIC)
Source:  U.S. Security and Exchange Commission - http://www.sec.gov/info/edgar/siccodes.htm

SIC        DESCRIPTION

5200        RETAIL -BUILDING MATERIALS, HARDWARE, GARDEN SUPPLY
5211        RETAIL-LUMBER & OTHER BUILDING MATERIALS DEALERS
5271        RETAIL-MOBILE HOME DEALERS
5311        RETAIL-DEPARTMENT STORES
5331        RETAIL-VARIETY STORES
5399        RETAIL-MISC GENERAL MERCHANDISE STORES
5400        RETAIL-FOOD STORES
5411        RETAIL-GROCERY STORES
5412         RETAIL-CONVENIENCE STORES
5500        RETAIL-AUTO DEALERS AND GASOLINE STATIONS
5531        RETAIL-AUTO & HOME SUPPLY STORES
5600        RETAIL-APPAREL & ACCESSORY STORES
5621        RETAIL-WOMEN'S CLOTHING STORES
5651        RETAIL-FAMILY CLOTHING STORES
5661        RETAIL-SHOE STORES
5700        RETAIL-HOME FURNITURE, FURNISHINGS & EQUIPMENT STORES
5712        RETAIL-FURNITURE STORES
5731        RETAIL-RADIO, TV & CONSUMER ELECTRONICS STORES
5734        RETAIL-COMPUTER & COMPUTER SOFTWARE STORES
5735        RETAIL-RECORD & PRERECORDED TAPE STORES
5810        RETAIL-EATING & DRINKING PLACES
5812        RETAIL-EATING PLACES
5900        RETAIL-MISCELLANEOUS RETAIL
5912        RETAIL-DRUG STORES AND PROPRIETARY STORES
5940        RETAIL-MISCELLANEOUS SHOPPING GOODS STORES
5944        RETAIL-JEWELRY STORES
5945        RETAIL-HOBBY,TOY & GAMES SHOPS
5960        RETAIL-NONSTORE RETAILERS
5961        RETAIL-CATALOG & MAIL-ORDER HOUSES
5990        RETAIL-RETAIL STORES, NEC














Attachment B
The City of Lawton
Retail Incentive Application


Project Name:_______________________________________________________________________________

1.     Property Owner:

    Contact Person:
    Address:
    City:                    Zip:        
    Phone:                    (Day)                         (Cell)
    Email:

2.     Developer:

    Contact Person:
    Address:
    City:                    Zip:        
    Phone:                    (Day)                         (Cell)
    Email:

3.     Leasing Agent (If Applicable):

    Contact Person:
    Address:
    City:                    Zip:        
    Phone:                    (Day)                         (Cell)
    Email:

4.     Location of Development:




5.     Project Engineer:




6.     Architect:








7.     Provide Brief Description of Development:



8.     Total Square Footage In Building/Development:


Name of Tenants  
Type of Business Product Line  
Square Footage  
Projected Annual Sales  
Projected Annual Sales Taxes  
Percent New To Economy  


9.    Tenant Mix




10.    Estimated Capital Investment
    Land:
    Construction:
    FF&E (including land cost):
    Other:    

    Total:



11.    Financing - Have you obtained a commitment from a leading institution?  (   ) Yes  (   ) No
    Name of Institution


    Contact Information




Note:  Please attach necessary documentation with respect to commitments from tenants (lease, letter of confirmation, etc.) as well as projected annual sales (market survey, etc.)


12.     Proposed Improvements (Please attach drawings)





13.     Describe Proposed Public Improvements:                Estimated Cost:
    (Such as Road, Water, Sewer, Traffic, Improvements, etc.)




14.     Describe Potential Private Improvements:                Estimated Cost:




15.     Describe Anticipated Project Timeline (days) (e.g. site prep, design, permitting, construction etc)




16.     Projected Construction Start Date

Applicant Certification

I hereby certify that the aforementioned information, under penalty of law, is true and correct to the best of my knowledge.


X__________________________________

Certified this _____ day of _______________, 20___.


X____________________________________________________________________________
  Name and Title

Submit To:    City Manager's Office
        212 SW 9th Street
        Lawton, Oklahoma 73501
        580-581-3301

An application fee of $750.00 must accompany the certified application.  The application fee includes all costs associated with processing the application and is not refundable if the application is rejected.


(1-10, Added, 02/24/2009)